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In Koontz v. St. Johns River Water Management District, a 5-4 majority of the United States Supreme Court reversed a state court decision that had limited the application of Nollan v. California Coastal Commission and Dolan v. City of Tigard. Nollan and Dolan concern the imposition of regulatory conditions on proposed development, also called exactions, which commonly occurs in land use regulation. In Koontz, a property owner challenged a regulatory agency's denial of his permit application following failed negotiations over exactions. The Florida Supreme Court had concluded that Nollan and Dolan did not extend to conditions that the agency had not officially approved and applied to the owner's property, nor did they extend to conditions that imposed fees on property owners. The United States Supreme Court reversed both conclusions, holding that Nollan and Dolan's heightened scrutiny, which reviews exactions for their “rough proportionality” and “nexus” to the proposed development, can apply in both contexts.
Unsurprisingly, in a public law doctrine as contested as regulatory takings, the initial responses to the decision, on blogs and in one early article, are fairly predictable--those sympathetic with government defendants or critical of the Court's occasional efforts to expand federal constitutional property rights disdain it, while those committed to robust constitutional property rights have embraced it. I suggest in this brief essay that we might best understand Koontz not as signaling a new direction in regulatory takings law, but as solidifying the Court's exactions jurisprudence as one of its curious carve-outs from the Penn Central test--the deferential test that the Court firmly ensconced as the default approach to regulatory takings claims in the most recent chapter of the doctrine's last half-century. Koontz, I argue, completes the move that the Court's 2005 decision in Lingle v. Chevron U.S.A. Inc. began, rendering the exactions decisions in Nollan, Dolan, and now Koontz, as conceptually and practically outside of the federal constitutional takings realm entirely, and existing in the astral realm, known as unconstitutional conditions. There, the exactions tests for nexus and proportionality can float free from the textual and remedial constraints that the Fifth Amendment, at least nominally, imposes on the regulatory takings doctrine. From that distant point, Nollan and Dolan should have little effect on the core regulatory takings tests--but they will, now, after Koontz, cause some considerable challenges for state and lower federal courts, especially when they must fashion a remedy besides the just compensation that the Fifth Amendment requires for a taking. In a brief final conclusion, I suggest that we cannot know the effects that Koontz will have on land use regulation, although we can expect that they will vary across jurisdictions and, like Nollan and Dolan, will, in some instances lead to more regulation and in others, lead to less.
Mark Fenster, Substantive Due Process by Another Name: Koontz, Exactions, and the Regulatory Takings Doctrine, 30 Touro L. Rev. 403 (2014), available at http://scholarship.law.ufl.edu/facultypub/487